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Yipes Enterprise Services Selects Zhone's GigaMux 50 Optical Access Platform for Enterprise Ethernet Applications

GigaMux 50 Expands Service Provider's Ability to Offer Low-Cost Fiber-Based Ethernet Services to Enterprise Subscribers

OAKLAND, Calif. — December 20, 2005 — Zhone Technologies, Inc.(Nasdaq: ZHNE), the first company dedicated to developing the full spectrum of next-generation local loop infrastructure solutions, today announced that Yipes Enterprise Services, Inc. (www.yipes.com), the pioneer in globally managed, end-to-end Ethernet solutions, has selected Zhone's GigaMux 50, a CWDM (coarse wavelength division multiplexing) platform as its global Ethernet service delivery platform.

GigaMux 50 provides a flexible, entry-level solution for optical edge network applications and supports up to four high-bandwidth, full-duplex services on a single fiber. The GigaMux 50 has already been deployed around the world by some of the world's largest service providers.

"Service providers are realizing the opportunity to extend their optical networks to thousands of new customers at the network edge, provided they can do so cost-effectively," said Chris Garcia, optical product manager for Zhone. "GigaMux 50 addresses this requirement for cost-effective, low channel-count optical access. This combination has become an essential element in our customers' strategies for adding more subscribers and selling more services."

Dr. Kamran Sistanizadeh , Yipes' chief technology officer said, "Zhone's GigaMux Coarse Wavelength Division Multiplexing (CWDM) solution provides Yipes with a convenient, low-cost alternative for transport of four optical channels - eight wavelengths - onto one single-mode fiber. The product's wide range of connectivity options allows Yipes to extend many traffic types because it provides us with a low cost, highly capable, fast deployment of services that can readily migrate from legacy protocols to converged service protocols running over Gigabit Ethernet."

The GigaMux 50 platform provides carriers a solution that is complementary to Zhone's proven GigaMux xWDM products. GigaMux 50 enables network operators to meet the requirements of entry-level customers deploying no more than four optical services per fiber. Each service may carry up to 2.5 Gbps over distances of up to 70 kilometers. As part of the GigaMux product family, GigaMux 50 shares the ability to both send and receive multiple voice, data and video streams over a single fiber.

With GigaMux 50, both carriers and their subscribers are provided with pay-as-you-grow flexibility. Preliminary installations can be used to offer existing services such as OC3, or OC12, then expand to new services, including scalable Gigabit Ethernet as needed. GigaMux 50 also supports all key network protocols, including Fibre Channel, FICON, Gigabit Ethernet and ESCON, as well as SONET/SDH services.

The GigaMux 50 does not require extensive optical training or network design knowledge to deploy. GigaMux 50 is managed by Zhone's easy-to-operate GigaView Network Management System. The platform is available in a compact, one rack-unit high package that is easy to install, provision and maintain.

About Yipes Enterprise Services (Yipes)

Winner of the Metro Ethernet Forum 2005 Service Provider of the Year Award for Outstanding Innovation, Yipes Enterprise Services, Inc., is the leading global provider of managed, end-to-end Ethernet solutions for enterprise customers. Yipes offers a uniquely scalable suite of networking services that combine the speed, simplicity and cost effectiveness of native Ethernet with Yipes proprietary bandwidth-on-demand functionality. Yipes provides services in and between major metropolitan markets including: Boston, Chicago, Dallas, Denver, Hong Kong, Houston, Los Angeles, London, Miami, New York, Philadelphia, San Diego, San Francisco, San Jose, Seattle, and Washington DC. For more information, visit www.yipes.com.

About Zhone Technologies, Inc. (Zhone)

Zhone designs and manufactures network equipment for network operators worldwide. Zhone's products allow network operators to deliver a rich array of voice, data, video and entertainment services over their existing networks while simultaneously retooling for converged packet-based voice (VoIP) and video (IPTV) over copper or fiber access lines. Zhone's advanced networking solutions include the Single Line Multi-Service architecture (SLMS™), Multi-Access Line Concentrator (MALC ), Raptor™ and GranDSLAM™ ATM/IP DSLAMs, ReachDSL™ Technology, FiberSLAM™ Optical Line Terminal, Zhone Residential Gateways (ZRG™), GigaMux™ Optical Transport Systems and Zhone Management System (ZMS™). With deployments at over 600 carriers including among some of the world's largest networks, Zhone has enabled network operators to reinvent their businesses. For more information, please visit http://www.zhone.com

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